DANSHUI PLANT NO.2 Background: Danshui was a contract manufacturer assembling electronic products in southern China. There were many manufacturers like Danshui in China assembling parts for the companies wishing to save labor costs. Apple contracted with Danshui to assemble 2.4 million iPhones in Plant No.2 with the expected high demand of this product in 2010. As a profit center‚ Plant No.2 was credited for each iPhone produced and shipped. The process of assembling was complex and required almost
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INTRODUCTION DANSHUI Plant No.2 is located in southern China was a contract manufacturer that assembled electronic products for companies wishing to save labor costs. DANSHUI was getting a one-year contract with apple Inc. to assemble 2.4 million iPhones. It was very anxious when in the first three months of the contract‚ the plant is unable to be assembled as many as the expected and its operating at a loss. The plant has had difficulty hiring enough workers despite raising wages to 35%. In
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from reading the Danshui Plant No.2 case‚ we can see that there is no enough information to evaluate the performance of the pant for the first three contracts to assembly Apple iPhone 4. Analysis of the issue To get a clear picture a flexible budget was prepared for the month end of August 2010. (Shown in the table below) From the flexible that is prepared it can seen the performance of Danshui Plant NO.2 is not good enough as what it suppose to be. The budget show that Danshui has unfavorable
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000 – 200‚000) X 11.80 = 20‚000 X 11.80 = 236‚000 F 5. It seems that the factory is producing a favorable amount of iPhone 4s however it is not efficiently doing it‚ therefore it is overall unfavorable. 6. Wentao Chen has issues with the plants profitability as well as it’s production. In terms of what he can improve on‚ Chen should focus on his labor issues. Since he cannot find qualified labor to match
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Introduction and Main Issue Danshui was a contract manufacturer in Southern China that assembled electronic products for companies wishing to save labour cost. Manufacturers like Danshui assembled parts in large plants using assembly line techniques according to specifications of the international companies that contracted with them for assembly and final testing. Danshui has a one-year contract with Apple Inc. to assemble 2.4 million iPhones4 in Plant No.2‚ which assembling computer hard drives
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DANSHUI PLANT NO: 2 Executive Summary: Danshui Plant No. 2 in southern China is a contract manufacturer that assembles electronic products and has a one-year contract with Apple Inc. to assemble 2.4 million iPhones. Monthly production target for DC is 200‚000 units but in the first three months of the contract‚ the plant is unable to assemble as many phones as expected and is operating at a loss. Wentao Chen‚ manager of Danshui was anxious on reviewing the monthly operation’s performance of august
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ACCOUNTING FOR BUSINESS DECISION MAKING (MBSA 1413) DANSHUI CASE STUDY PREPARED FOR DR. SULAIMAN ARIS PREPARED BY MUHAMMAD ASHRAF BIN LISMAN (MBS141031) KHAIRUL IKHSAN BIN SELAMAT (MR 121159) ROHESWARAN GANEASON (MR 131107) 9TH MAY 2015 Questions: Danshui Plant No. 2 1. Using budget data‚ how many Apple iPhone 4’s would have to have been completed for Danshui Plant No. 2 to break even? Variable Costs = Material Cost + Labor Cost + Shipping Cost = 187.89+13.11+1.06 = 202.06 / Unit Fixed
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Danshui Plant No. 2 Case Study Analysis Submitted By: Pranav Goyal Q2) Total cost per unit can be given by: 41‚140‚000/200‚000 = $ 205.7 Similarly actual cost per unit: 38‚148‚000/180‚000 = $ 211.93 Q3) Please find attached the table for flexible budget and flexible budget variances in the Appendix 1. Q4) Flash Memory:
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August. 5 6) Give your suggestions on some strategies or decisions that Wentao Chen should consider in trying to solve the problems with the Apple iPhone 4 contract in the next nine months? How would theses change the cost and profitability of Danshui Plant No. 2 iPhone 4 contract? 6 Works Cited 7 1) Explain briefly contribution margin. How is it calculated? Contribution margin is defined as how much of a company ’s revenues will be contributing (after covering the variable expenses)
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Introduction Danshui Plant No.2 is a contract manufacturer locating in southern China and was assembles electronic products for companies wishing to save labor costs and they are using semiskilled labor for less than 1 dollar an hour. In August 2010‚ Danshui Plant No.2 in southern China has a 1 year contract in the period between 1 June 2010 and 31 May 2011 with Apple incorporation to assemble the Apple iPhone 4. Based on the contract‚ Danshui need to assemble 2.4 million iPhones within 1 year.
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